One hundred and sixty-two funds of funds vehicles are seeking $37bn in aggregate capital, according to Preqin’s most current data. The largest of these is Guochuang Kaiyuan Fund of Funds, which is seeking $1.54bn. Part of a joint venture between China Development Bank (CDB) and Suzhou Ventures Group, its main objective is to provide capital for domestic (Chinese) private equity and venture capital firms that are having difficulty raising funds, and it expects to be a significant limited partner for each fund in which it participates. The fund will focus on investing in buyout funds and vehicles which will target relatively well-developed industries and enterprises, including medium to high-end manufacturers and financial institutions.
The next largest private equity fund of funds vehicle seeking capital is HarbourVest Partners IX – Buyout, which has a target of $1.5bn. The fund will make primary and secondary investments in buyout funds, with a particular focus on US vehicles, and is known to have already raised at least $725mn from investors. Euro Choice V has a target of $1bn and held a first close in July 2012, having raised 24% of the targeted capital. Its investment portfolio will focus on buyout, growth capital and, selectively, special situations investments in small and mid-sized companies, while seeking diversification of risk by making primary and selectively secondary fund investments, as well as direct co-investments.
HarbourVest Partners IX – Venture has a target of $1bn and will focus on investing in US-focused venture capital vehicles. Siguler Guff BRIC Opportunities Fund III is also targeting $1bn and will invest in the BRIC countries, with a particular emphasis on investments in China.